~Company delivers record revenue with 121% year-over-year growth and 70% year-over-year growth in total assets~
VANCOUVER, BC, October 30, 2019 – TIMIA Capital Corporation (“TIMIA” or the “Company”) (TSX-V:TCA / OTC: TIMCF) today announced financial results for the third quarter ended August 31, 2019.
Third Quarter 2019 Highlights include:
- Record revenue of $884,231, up 121% over the same period last year.
- Posted record interest income from investments, included in total revenue, which increased 170% to $857,587 compared with the same period last year.
- Total assets increased 70% to $22.3 million as at August 31, 2019 compared to the same period last year. Cash balance, as part of assets, was $5.0 million compared to $3.7 million as at November 30, 2018.
- Adjusted EBITDA* of $74,382 compared with an Adjusted EBITDA* of $109,686 for the same period last year.
- Reported a net loss of $54,658, or $0.00 per share, compared with a net loss of $413,221, or $0.01 per share, for the same period last year.
- TIMIA’s loan investment portfolio (Loans receivable) increased by 127% to $16,385,629 in comparison to the same period last year.
“We continue to leverage our fintech platform by putting capital to work in more and more growing software companies,” said Mike Walkinshaw, CEO of TIMIA Capital Corporation. “The net result is another record quarter in revenue and an improved bottom line as the deployed capital starts to generate returns. We’re investing in great entrepreneurs with great companies which are benefiting from strong sector growth and the occasional exit through M&A activity. Our investment thesis and expanding fintech platform is supported by the increase in capital from our non-dilutive Limited Partnership structure which drive above industry average returns. We have some exciting opportunities on the horizon and look forward to keeping our shareholders apprised of our progress.”
Detailed Financial Review
During the quarter ended August 31, 2019, the Company continued to grow its revenue-financing (“RF”) business by completing two new investments, distributing growth capital of US$1,250,000 to two American companies.
The Company’s revenue is primarily interest income generated under the Company’s RF model. As the Company makes new investments, the amount of monthly payments derived from the portfolio grows. Interest income in the three months ended August 31, 2019 was $857,587 compared to $317,787 in the same period last year, a 170% increase. Income from transaction and other fees was $26,644 in the three months ended August 31, 2019 compared to $82,204 in the same period last year. Total revenue for the three months ended August 31, 2019 increased 121% to $884,231 compared to $399,991 for the three months ended August 31, 2018.
TIMIA continues to build the value and size of its portfolio by making new investments and follow-on investments in existing portfolio companies, and actively assisting portfolio companies with their growth plans. At the same time, the Company is investing to support its future growth and the continued development of its fintech platform. Total expenses for the quarter ended August 31, 2019 were moderately higher at $795,087 compared with $747,473 for the same period last year.
During the quarter ended August 31, 2019, the Company posted a net loss of $54,658 compared with a net loss of $413,221 in the same period last year. The year-over-year improvement is primarily due to growth in size of the portfolio and relative increase in revenue. Adjusted EBITDA* of $74,382 for the quarter ended August 31, 2019 compared with an Adjusted EBITDA* of $109,686 for the same period last year.
As at August 31, 2019, the Company’s cash balance was approximately $5.0 million and working capital was approximately $4.7 million, compared with approximately $3.7 million and $3.6 million, respectively, as of November 30, 2018. The funds raised by the private placement of debentures, the limited partnership, co-investment agreements and cash generated from the underlying portfolio are expected to provide the Company with enough funds to operate and grow the business into 2020.
This news release is qualified in its entirety by the Company’s condensed interim financial statements for the three and nine months ended August 31, 2019 and 2018 and the associated Management’s Discussion & Analysis respecting the same period, which can be downloaded from the Company’s profile on SEDAR at http://www.sedar.com.
*Non-GAAP Measures and Other Financial Measures
In managing our business and assessing our financial performance, we supplement the information provided by the GAAP-based financial statements with metrics and non-GAAP financial measures which are utilized by our management to evaluate our performance. Although we believe these measures are widely used in the specialty finance industry, some may not be defined by us in precisely the same way as by other companies in the specialty finance industry, so there may not be reliable ways to compare us to other companies. Adjusted EBITDA represents net loss and comprehensive loss from continuing operations (the most directly comparable GAAP measure) excluding amounts for: income tax expense; interest expense; depreciation and amortization; non-cash revenue; non-cash gains; equity-based compensation; and all other non-cash expenses. We believe Adjusted EBITDA is a helpful measure because it allows us to evaluate our performance by removing from our operating results items that do not relate to our core operating performance. Adjusted EBITDA is not a measure of financial performance under GAAP and should not be considered in isolation or as a substitute for net loss and comprehensive loss from continuing operations, the most directly comparable GAAP financial measure. Adjusted EBITDA is not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies unless the definition is the same.
About TIMIA Capital Corporation
TIMIA Capital Corporation is a specialty finance company that provides growth capital to technology companies in exchange for payments based on monthly revenue. This alternative financing option complements both debt and equity financing, while allowing entrepreneurs and existing stakeholders to retain ownership and control of their business. TIMIA’s singular focus is the fast growing, global, business-to-business Software-as-a-Service (or SaaS) segment. We align ourselves with entrepreneurial management teams growing their sales from $1 Million to $10 Million in Annual Recurring Revenue. For more information about TIMIA Capital Corporation, please visit www.timiacapital.com
For more information, please contact:
Vice President, Capital Markets & Communications
Mike Walkinshaw, CEO
TIMIA Capital Corporation
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Certain information and statements in this news release contain and constitute forward-looking information or forward-looking statements as defined under applicable securities laws (collectively, “forward-looking statements”). Forward-looking statements normally contain words like ‘believe’, ‘expect’, ‘anticipate’, ‘plan’, ‘intend’, ‘continue’, ‘estimate’, ‘may’, ‘will’, ‘should’, ‘ongoing’ and similar expressions, and within this news release include any statements (express or implied) respecting deployed capital generating future returns and the expectation that the funds raised by the private placement of debentures, the limited partnership, co-investment agreements and cash generated from the underlying portfolio will provide the Company with enough funds to operate and grow the business into 2020. Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions and other factors that management currently believes are relevant, reasonable and appropriate in the circumstances, including, without limitation, the following assumptions: that the Company and its investee companies are able to meet their respective future objectives and priorities, assumptions concerning general economic growth and the absence of unforeseen changes in the legislative and regulatory framework for the Company. Although management believes that the forward-looking statements are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to Timia’s business. Material risks and uncertainties applicable to the forward-looking statements set out herein include, but are not limited to, the Company having insufficient financial resources to achieve its objectives; availability of further investments that are appropriate for the Company on terms that it finds acceptable or at all; successful completion of exits from investments on terms that constitute a gain when no such exits are currently anticipated; intense competition in all aspects of business; reliance on limited management resources; general economic risks; new laws and regulations and risk of litigation. Although Timia has attempted to identify factors that may cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, predicted, estimated or intended. Also, many of the factors are beyond the control of Timia. Accordingly, readers should not place undue reliance on forward-looking statements. Timia undertakes no obligation to reissue or update any forward-looking statements as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements contained in this news release are qualified by this cautionary statement.